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How to straighten out a restaurant?

Restaurant business management is not just a job. It is also a beautiful adventure that sometimes allows you to live in joy, in anguish, in fear… If you want to continue your adventure, you must overcome all these obstacles. Managing a restaurant establishment requires a well-thought-out marketing strategy. This avoids any risk of loss or even bankruptcy. However, sometimes you have no other way out than recovery to solve the problems of your restaurant. Find out here how to turn your struggling restaurant around.

Determine the sources of problems for a restaurant business

Determine the sources of problems for a restaurant business

Determine the various possible causes of your restaurant’s difficulties:

  • Unstable business situation;
  • Finance and cash management issues;
  • Quality problems of your service by your staff or team not professional enough. The reputation of your restaurant is played on your menu, your service or the quality of your cuisine offered;
    Communication or customer attendance problems that impact your cash flow;
  • Bad customer reviews, sometimes on the internet.

A good analysis always leads to a good turnaround of a struggling restaurant business.

The best solution to analyze your restaurant is to call on professionals (business management professional, accountant, etc.).

Also conduct a customer survey by collecting opinions from your customers. You must have satisfaction questionnaires on your tables. This allows customers to express what they think of your restaurant in terms of hospitality, service, atmosphere, cuisine, value for money and other elements. Also, ask your staff, chef, manager, to improve the management of your catering establishment with their opinion.

Also, audit your finances by making an accurate inventory of your expenses. This step allows you to identify any cash management errors that have led your restaurant into difficulty. To do this, you need to draw up a cash flow table.

Turning around a struggling restaurant: the solutions

Turning around a struggling restaurant: the solutions

Once the problem analysis is done, it’s time to turn your business around with our next solutions.

Look into your restaurant expenses
There are two solutions:

Call on your suppliers and try to negotiate lower prices : to encourage your partners to support you, discuss the opportunity to change suppliers. Certain suppliers surely have more interesting offers;
Communicate with new partners: you can obtain attractive prices from a service provider by explaining that the previous one did not meet your requirements.
You have to reduce your expenses without sacrificing the quality of your dishes. Also try to renegotiate your lease contract and lower your rent to reduce your charges.

Analyze your margins
For optimal management of a catering establishment, it is necessary to establish margin coefficients of 4 on foodstuffs and 10 on liquids. In other words, you have to sell a product bought at 1 euro in 4 euros up to 10 euros when it is transformed.

Distribute your expenses fairly
The financial structure of a restaurant is as follows:

  • 30% for wages and social and employer contributions;
  • 30% for raw materials;
  • 30% overhead and 10% profit.

These percentages vary depending on the location of your restaurant. However, you can take these ratios as goals to achieve in order to turn your establishment around.

Make a cash flow statement
On the one hand for past cash flows and on the other for the future. For the first part, break down all charges and expenses made so far. For the second, develop cash flow forecasts based on the figures achieved the previous year and on the change in attendance.

There are cash management software programs that make the job easier for you.

Screen your team
To do this, carry out training with your team (kitchen staff, chef, manager) by showing you the example. If your teams are holding back your business, especially the kitchen staff, recruit new elements.

Refine inventory management

Manage your stocks accordingly! Not too superficial to avoid tied up cash and food waste for delicate products. Not too light to avoid the unavailability of a dish in stock, which can cause a problem for your customers.

Change your menu and your concept of cooking

Changing the menu of his restaurant can attract new customers.

Organizing a test meal will reassure you that you are on the right track. Invite 20 to 30 customers representative of your clientele and offer them a new menu (two starters, two main courses, two desserts). Plan questionnaires for them (reception, service, quality of dishes, etc.) and collect their opinion.

Refining the concept of your catering business is ideal if the idea of ​​attracting new customers with new dishes is a failure. For this, you must take into account the reception, atmosphere, decor of your restaurant, your tables…

Establish a marketing and communication strategy

Finally, for the recovery of your restaurant, post on social networks to attract more customers.

At the same time, set up an event calendar on festive days to get your restaurant talked about and challenge other restaurants more easily.

So, with these catering business turnaround solutions, your restaurant will be out of trouble.

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